Malaysian oil and gas service providers SapuraCrest and Kencana on verge of merging

Malaysian firms SapuraCrest Petroleum and Kencana Petroleum are on the verge of becoming the country's largest oil and gas service provider as a merger deal is near completion. The merged entity is expected to boost market capitalisation of RM10bn ($3.3bn) plus some RM6bn worth of assets. For the deal to go through, 75% of the shareholders of both companies must approve the offer. The board of SapuraCrest and Kencana have 32 days to accept the offer before it lapses. Maybank Investment Bank and CIMB Investment Bank have stepped forward to facilitate the deal. “We believe the proposed merger is timely, in light of the investment cycle in the oil and gas sector, especially in exploration and production activities (upstream),” said Zafrul Tengku Abdul Aziz, ceo of Maybank Investment Bank.